Most Expensive, Cheapest States for Car Insurance

It's no secret that drivers in different states pay different rates, even when their driving records are very similar. Recently the website Insure.com did a comparison of state automobile insurance costs, identifying the priciest and cheapest states for car insurance.

The survey averaged coverages from six providers per state for a 40-year-old driver with a 12-mile commute to work. The quotes were for a yearly policy with $100,000 coverage for a single person, $300,000 for all injured and $50,000 for property damage.

Michigan, $2,541

Louisiana, $2,453

Oklahoma, $2,197

Montana, $2,190

Washington, D.C., $2,146

California, $1,991

Mississippi, $1,896

New Mexico, $1,896

Arkansas, $1,836

Maryland, $1,807

North Dakota, $1,794

Connecticut, $1,786

Rhode Island, $1,747

Wyoming, $1,714

Hawaii, $1,707

South Dakota, $1,707

Georgia, $1,670

New Jersey, $1,663

West Virginia, $1,633

Kentucky, $1,629

New York, $1,627

Minnesota, $1,614

Washington, $1,584

Missouri, $1,563

Indiana, $1,518

Colorado, $1,508

Texas, $1,492

Delaware, $1,489

Florida, $1,476

Nebraska, $1,470

Pennsylvania, $1,468

Kansas, $1,461

Alaska, $1,454

New Hampshire, $1,334

Massachusetts, $1,328

Idaho, $1,325

Alabama, $1,306

Oregon, $1,306

Nevada, $1,300

Illinois, $1,290

Arizona, $1,280

Utah, $1,272

Virginia, $1,237

Iowa, $1,179

North Carolina, $1,154

Ohio, $1,152

Tennessee, $1,146

Wisconsin, $1,128

Maine, $1,126

South Carolina, $1,095

Vermont, $995

Why is there such a difference (255%) between the most and least expensive? According to Insure.com, the reasons are several.

The primary one, however, is uninsured motorists. In states with a lot of uninsured motorists, the insured must kick more money into the pool to cover accidents in which they are involved.

The leading state in insurance premiums, Michigan, finished 10th with 17%. So why was it No. 1? For one reason, of all the states, only Michigan has no cap on personal injury protection payments to those hurt in a vehicle accident. A separate, not-for-profit, state-originated association picks up payments only after the insurance company has paid out almost half a million dollars in claims, in addition to three years of lost wages and damage replacement costs. Of course, all of these expenses are paid for with insurance premium dollars.

Insure's report also suggests that the friendly climate for litigation in Louisiana helps drive up its premiums, while violent weather does the same for Oklahoma drivers.

At the other end of the spectrum, Vermont's low premium is, according to one expert, a function of low traffic volume and "rural sensibilities."

Concerned about the cost of car insurance? Then you might also consider which car you drive. It can make an even larger difference than where you drive it.